Trying to understand how Vermont pays for its schools can be a difficult task. This Joint Fiscal Office paper from Chloe Wexler, Fiscal Data Analyst, and Mark Perrault, Senior Fiscal Analyst does a great job breaking down the basics.
Takeaways from the report:
- Vermont has a unique education finance system – a statewide funding formula coupled with local property tax administration.
- School boards set budgets and submit them to voters for their approval, maintaining local control over education spending.
- The Legislature sets education property tax rates annually at the level necessary to fund voter-approved school budgets.
- To comply with the Brigham decision, the homestead property tax rate is a function of district per-pupil spending rather than property wealth.
- The tax bills of homeowners who are eligible for a property tax adjustment also vary in proportion to per-pupil spending.
- Since the enactment of Act 68, the nonresidential tax rate has been uniform statewide – the tax rate is not directly related to per-pupil spending.